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Could someone please help. I try to alter, crop, enahnce etc digital photos on iPhoto but they never seem to be saved anywhere.

I open the photo, alter it and then press DONE to save - is this correct? I can't seem to find a SAVE button. DoI have to export to save it. Nothing seems to save my altered pictures. I know I am doing something very basic that is wrong....

What is the process to actually save changes you made to pics? And where are those saved pics located?

If I remember correctly... the default in iPhoto is to change the ORIGINAL... After you have made the changes, and click done... it will pop-up a "saving Changes" window.... Go into the iPhoto Library and open the photo again... the changes you made should show.

But it ALWAYS works non-destructively:
It actually saves a copy of the original image and also of the altered picture. Right-click an image and select 'revert to original' if you want your original back.